An IPO (Initial Public Offering) is when a private company offers its shares to the public for the first time to raise capital and get listed on a stock exchange.

Listing helps raise funds, increases credibility, provides liquidity to shareholders, enables brand exposure, and facilitates future capital raising.

Main types include Fixed Price IPO, Book Building IPO, and SME IPO for small and medium enterprises.

Mainboard IPO caters to large companies with higher paid-up capital, strict eligibility, SME IPOs are for smaller firms with relaxed norms.

Listing means your company’s shares are officially traded on stock exchanges like BSE or NSE.

Generally includes minimum net worth, positive operating profit for certain years, minimum track record, promoter experience, and compliance with SEBI guidelines.

Startups can go public if they meet SEBI criteria or via SME listing but must be operationally stable with audited financials.

Usually at least 3 years of consistent financial performance; certain relaxations for startups and SMEs apply.

Yes, post conversion the company should have at least one full financial year’s audited statements.

Promoters generally must hold a minimum percentage of shares post-IPO (typically 20%), demonstrating skin in the game.

Yes, promoter shares are subject to lock-in periods (commonly 3 years for minimum contribution).

SEBI approval for the prospectus, stock exchange approval for listing, and Registrar of Companies compliance.

Typically 03 to 06 months from preparation to listing depending on company readiness.

Includes Draft Red Herring Prospectus (DRHP), audited financials, legal compliance certificates, corporate governance reports, and others.

A preliminary document filed with SEBI containing company details and risk factors, open for regulatory review and public comments.

They act as intermediaries managing the IPO process, including due diligence, pricing, marketing, and regulatory coordination.

Price discovery mechanism based on investor demand allowing flexible IPO pricing.

Existing shareholders selling their shares as part of the IPO without fresh capital raising.

No, using IPO proceeds to repay promoter’s or related party loans is prohibited.

Based on valuation studies, market conditions, investor feedback, and financial advisor recommendations.

They showcase company’s financial health, profitability, and growth to investors and regulators.

Not mandatory for SME IPOs and certain startups, but profits strengthen investor confidence on the mainboard IPO.

Loss-making firms may face extra scrutiny or may defer IPO until profitability or list via SME platform if eligible.

Minimum subscription depends on price band and lot size but often ₹2 lakhs minimum for SME IPOs.

The total value of a company’s shares outstanding, key for investor perception and index inclusion.

Adequate director composition, audit committees, internal controls, disclosure norms, and board meetings per SEBI and exchange rules.

Yes, to ensure ethical conduct and transparency within the company.

Post-IPO companies must disclose quarterly/annual results and price-sensitive information per guidelines.

Minimum holding periods during which promoters or pre-IPO shareholders cannot sell their shares.

Statutory auditors or a monitoring agency if issue size crosses threshold limits.

Usually within 03 to 06 days of the close of the subscription period.

Regular communication through disclosures, annual reports, and investor meetings.

Market forces determine price; company must maintain transparency and good governance to build confidence.

Yes, SEBI can impose fines or suspension for disclosure or governance violations.

No, promoter shares are subject to defined lock-in periods.

Timing IPOs during stable markets is advisable to maximize valuation and minimize risks.

Yes, with proper governance and compliance, family-run businesses successfully raise capital via IPO.

Listing dilutes promoter ownership; requires balancing between control & access to capital.

Transparent communication, strong operational performance, and managing market feedback are critical.

While optional, it helps ensure professional handling of market communications.

SEBI (Issue of Capital and Disclosure Requirements) Regulations govern IPO processes and disclosures.

Yes, comprehensive risk disclosures are mandatory to protect investors.

Companies must update the offer document and inform SEBI and investors timely.

Account holding the IPO subscription money till listing or refund.

Yes but disclosures of material litigations are mandatory.

Paid-up capital typically under ₹25 crores, minimum operating profits criteria relaxed compared to mainboard.

NSE Emerge and BSE SME are the primary SME exchange platforms in India.

Generally less expensive and less time-consuming than mainboard IPOs.

Offer for Sale limited to 20% of issue size.

No, similar restrictions apply as mainboard IPOs.

Strengthen accounting, compliance, risk management, and IT infrastructure.

Ensure compliance with policies and identify operational gaps.

Depends on issued capital, SEBI norms, and investor appetite.

Usually 20% locked in for a specific period post-IPO.

No, all shares to be fully paid up before IPO.

Pricing mechanism based on investor demand.

IPO may be called off or shares allotted on pro-rata basis.

Range within which investors can bid for shares.

Formal document detailing company information, risks, and offerings.

Yes, that’s the basic definition of IPO.

Look for experience, reputation, and fees structure.

Cut-off price is finalized IPO price; floor is minimum price allowed.

Regulates secondary market disclosures and compliance.

Certain investors can get tax benefits; companies pay capital gain tax.

Merchant bankers guarantee the sale of IPO shares.

Large institutional investors who subscribe before IPO opens to boost confidence.

Employee stock options are regulated and disclosed.

Period during which shares cannot be sold post listing.

Promoters can’t participate in the offering, only pre-IPO holdings apply.

Must include all potential business, operational, financial and market risks.

Yes, via ADRs/GDRs or overseas IPOs, but more regulations apply.

Listing the same company shares on two or more stock exchanges.

Lead merchant banker managing the IPO book building.

Risk arising from potential changes or non-compliance with regulations.

Due diligence, strong management, clear disclosures, and proper planning.

No, SMEs and startups also have tailored routes.

Partially yes, but often promoters retain significant voting power.

No profits depend on company and market performance.

Not much. Costs include merchant bankers’ fees, legal, compliance, marketing, and exchange charges.

Due to regulatory queries, market conditions, and documentation issues.

In compliance with SEBI and accounting standards.

Mechanism to address shareholder complaints post IPO.

Managing share allotment, demat, and investor communication.

Quarterly financial results, shareholding pattern, promoter changes.

Bonus issues, rights issues, buybacks require regulatory filings.

Financials, market sentiment, comparable valuations, demand.

High volatility can delay or depress IPO pricing.

Recommended but not mandatory for SME IPOs.

More bids than shares offered; shares allocated pro-rata.

Reputation strongly affects investor interest and pricing.

Strong business performance, communication, and governance.

Yes, post listing shares can be pledged.

Company buys back its shares to reduce capital or improve valuation.

No, dividend policy varies by company and profit.

Must comply with disclosure and shareholder approval rules.

Varies by issue; SME IPOs commonly 2 lots minimum.

Shares converted into electronic form for trading.

Regulations mandate disclosures, grievance redressal, and investor education.

Regulations mandate disclosures, grievance redressal, and investor education.

Consider investor base, fees, trading volumes, and advisory support.